The U.S. Securities and Exchange Commission has asked a Texas federal court to order two California companies, their owner, and two of his sales associates to pay close to $17 million for running an oil and gas scheme. The scheme duped roughly 475 investors into buying oil and gas limited partnerships interests for a total of more than $33 million dollars of investor money.
SEC Bids for Final Judgements in Oil and Gas Scheme
The request is part of the SEC’s bid for final judgements against Team Resources Inc., Fossil Energy Corp., their owner Kevin A. Boyles and his alleged sales associates John Olivia and Michael Eppy. In addition to disgorgement of $15.5 million for Boyles and his companies, and more than $700,000 each for Olivia and Eppy, the SEC requested the court to order them to pay interest plus hefty civil monetary penalties.
An alleged third sales associate, Philip A. Dressner, is also expected to settle. The fourth, Andrew Stitt, was given a default judgment of close to $500,000 in 2016 after he failed to appear in the case.
SEC Says Oil and Gas Scheme Misled Investors
According to the SEC’s complaint, the scheme involved the California-based Team Resources Inc., and, later, Fossil Energy Corp. and its owner Kevin A. Boyles. They acquired leases on oil and gas fields in Kansas and then put them into limited partnerships.
According to the SEC, Boyles then used sales associates in California and Florida to cold-call investors and sell offerings in the partnerships, touting fantastic production projections. Once the oil and gas wells were drilled, the the oil and gas produced was far below projections.
Instead of disclosing this fact, Boyles and the companies misled investors with false positive updates rather than report the failure to meet production projections. Boyles also failed to tell investors that sales associates received sizeable commissions ranging from 25 to 35 percent.
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If you believe you have been the victim of an investment scheme, you may have certain legal rights that require your immediate attention.
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If you are looking for an investment fraud attorney to review your rights and options, the investment fraud lawyers at Dimond Kaplan & Rothstein, P.A. have recovered over $100 million from banks and brokerage firms for their wrongful actions.